86: Changing Options Strategies When Trading Inverse ETFs

Show notes: http://optionalpha.com/show86

Trading inverse ETFs and leveraged ETFs are becoming more and more popular with retail traders. Maybe it’s the appeal of quick profits with 2X and 3X leveraged securities like FAZ (Ultra Bear 3X Financials) but the should we adjust our options strategy for these unique products? I think we should for good reason.

In today’s newest podcast I’ll cover the three different ways you should adjust your options strategy when trading these products to take advantage of their mostly negative pricing structure and hedging potential. While we don’t trade these often by any stretch here as part of our income strategy, there are instances where they become useful and we’ll cover that specific setups in the show. Enjoy!